Arthur O’Reilly, ’02 J.D., Saving the Cultural Soul of a City

If you were to ask Arthur O’Reilly what his favorite piece of art is in the Detroit Institute of Arts, he would tell you that Diego Rivera’s murals have the greatest meaning to him because they tell an important story about Detroit and its history. But he would quickly add that right now, he is drawn to Mark Rothko’s “Orange and Brown 1963.”

O’Reilly is not an art historian. But he and his colleagues at Honigman Miller Schwartz and Cohn spent the better part of the last year helping to preserve the Detroit Institute of Arts’ 60,000 piece collection, which certain creditors of Detroit claimed should be liquidated to pay City debts and obligations in the City’s historic Chapter 9 bankruptcy case. A city treasure lost forever.

“Honigman has had a long and deep relationship with the Detroit Institute of Arts and I have represented the museum in litigation matters for a number of years,” states O’Reilly. “When the museum art collection was put in jeopardy, the DIA turned to us.”

In July of 2013 the city of Detroit filed for Chapter 9 bankruptcy in the largest filing by debt in United States history, estimated between $18-20 billion. Among the debts left unpaid were pension funds for municipal retirees. One of the assets considered for liquidation was the content of the museum, which some creditors valued at over four billion dollars. The DIA contested the ownership of the art and believed the city did not have a right to monetize the collection.

“By a strange quirk of history, the City claimed to own the museum building and the museum art collection, “ O’Reilly explains. “The issue in the case was whether the City, even if it held title, had any right to sell the multi-billion dollar collection, 95% of which was donated or purchased using donated funds.”

Tensions were running high as parties began jockeying for position. This was a one-of-a-kind situation that kept everyone searching for the best possible outcome. What ultimately was crafted became known as the “Grand Bargain.” The groundbreaking arrangement would include outside contributors putting up $800 million in Detroit’s underfunded pension plan in exchange for taking the DIA’s collection off the table.

“There was considerable public debate over this issue,” says O’Reilly. “On the one hand, there was concern over the problems confronting the pensioners. On the other hand, most with an interest in the long-term future of the City, including many pensioners, were troubled by the thought of destroying the museum. What made the Grand Bargain so remarkable was that it reconciled these seemingly inconsistent concerns by both preserving the art collection and protecting the interests of retirees. “

To have played a part in such a seminal case is not lost on O’Reilly.

“I believe very strongly in Notre Dame’s focus on producing a ‘different kind of lawyer.’ Representing the DIA in this case gave me the opportunity to work on a matter with unimaginably high stakes while also making a difference in our community. This case was everything I hoped to be able to do as a lawyer when I enrolled in Notre Dame and will be a high point of my professional and personal life.”

To learn more about the work of O’Reilly in this matter you can read the article in The American Lawyer magazine here.